Core Viewpoint - The report from Tianfeng Securities indicates that after the market reached new highs, there is an accelerated entry of sidelined funds, emphasizing a cautious and steady approach to investment [1][3]. Investment Themes - Investment themes can be categorized into three main directions: 1) Breakthroughs in Deepseek and leadership in open-source technology AI+ 2) Valuation recovery in consumer stocks and gradual recovery in consumer segmentation 3) Continued rise of undervalued dividends [1][3]. Market Dynamics - The report analyzes the logic behind the A-share market's volume increase and new highs, noting that weak returns in the real economy may lead private sector asset allocation to shift towards financial assets. Historical patterns show that during previous bull markets, non-bank deposits significantly increased when real estate and economic returns were weak [1][2]. Consumer Sector Insights - The core factor for investment in the consumer sector is valuation. Given the current low valuations, declining interest rates, and policy catalysts, the consumer recovery cycle is expected to gain momentum. Being overly pessimistic about future consumer performance may be excessively conservative [1][3]. International Context - The report highlights international developments, including the U.S. core CPI growth exceeding expectations, with July's core CPI year-on-year at 3.1%, up from a previous 2.9% [2].

Group 1: Market Insights - The report indicates that the upcoming bull market is influenced by weak returns in the real economy, leading private sector investments to shift towards financial assets, particularly during periods of low returns in real estate and the economy [1][10][11] - Historical data shows that during previous major bull markets, such as 2006-2007 and 2013-2015, the proportion of non-bank deposits significantly increased, indicating a shift in asset allocation towards financial markets [11][15] - The report highlights that the current economic environment, characterized by low returns in the real estate market and a decline in the Producer Price Index (PPI), suggests that the return rates in the real economy remain insufficient [18][14] Group 2: Economic Data Trends - Recent economic data from July shows a decline in growth rates across three major indicators: industrial production, investment, and retail sales, all falling below expectations [2][36] - Industrial production year-on-year growth was reported at 5.7%, below the expected 5.82%, while retail sales growth was at 3.7%, compared to an expected 4.87% [36] - The report notes that the financing pulse continues to recover, with new RMB loans turning negative year-on-year, indicating a tightening in credit conditions [2][36] Group 3: International Economic Context - The report tracks international developments, noting that the U.S. core CPI growth in July exceeded market expectations, which may influence global economic conditions [3][20] - The geopolitical landscape, including the ongoing Russia-Ukraine conflict and tensions in the Middle East, is also highlighted as a factor that could impact market stability and investor sentiment [3][20] Group 4: Industry Allocation Recommendations - The report suggests focusing on three main investment themes: advancements in technology AI, recovery in consumer stock valuations, and the resurgence of undervalued dividend stocks [4][10] - It emphasizes the importance of a cautious approach in the current market environment, particularly in the context of the ongoing bull market and the influx of capital from previously sidelined investors [4][10] - The report also points out that the performance of undervalued dividend stocks is closely tied to the progress of the AI industry trend [4][10]

Core Insights - The overall industry sentiment shows an upward trend in sectors such as steel, power equipment, electronics, food and beverage, environmental protection, and retail, while sectors like oil and petrochemicals, machinery, light manufacturing, home appliances, automotive, banking, real estate, and public utilities are experiencing a downward trend [1] - The report emphasizes the importance of specific industries such as specialized equipment, shipping ports, railways, airports, packaging, motorcycles, engineering machinery, and various health and energy sectors for investment opportunities in the upcoming weeks [1][9] - The investment strategy focuses on three main directions: breakthroughs in technology AI+, valuation recovery in consumer stocks, and the continued rise of undervalued dividends, with a cautionary note on market volatility and the need for a steady approach [1] Industry Performance Tracking Upstream Sector - In the basic chemical sector, the weekly settlement price for soda ash is 1336.0 yuan/ton, up 6.54% week-on-week [19] - The price index for hardware tools and abrasives is 125.17 points, down 0.11% week-on-week [20] - The average price of Topcon components is 0.7 yuan/watt, up 4.2% week-on-week [20] Midstream Sector - The new order volume in the defense and military industry increased by 62.14% month-on-month, reaching 2,703,016 tons [20] - The average price of DRAM DDR3 (4Gb) is 1.74 USD, up 3.08% week-on-week [21] - The cumulative investment in power grid construction reached 291.1 billion yuan, up 42.71% month-on-month [20] Downstream Sector - The average price of meat chicken seedlings is 3.13 yuan per chick, up 21.79% week-on-week [1] - The average price of white cardboard is 4010 yuan/ton, down 2.43% week-on-week [1] - The passenger volume of the Suzhou subway is 2.156 million, up 27.57% week-on-week [1]

Domestic Economic Indicators - In July, the core CPI showed zero growth year-on-year, while the PPI remained unchanged, leading to a narrowing of the PPI-CPI gap from -3.7% in June to -3.6% in July [7][8][10] - The July CPI increased by 0.4% month-on-month, reversing the previous month's decline of -0.1%, while the PPI decreased by -0.2% month-on-month, improving slightly from -0.4% [7][10] - July exports (in USD) rose by 7.2% year-on-year, exceeding expectations, while imports increased by 4.1%, also surpassing forecasts [17][21] Industry Configuration Recommendations - The report emphasizes the importance of the "赛点 2.0" third phase, indicating that the market is experiencing overheating and increased volatility, necessitating a cautious approach [46] - Investment themes are categorized into three main directions: 1) Technological advancements in AI, 2) Recovery in consumer stock valuations, and 3) Continued rise of undervalued dividends [46] - The report suggests that the performance of the consumer sector is closely tied to valuation, with a potential recovery cycle supported by low valuations, declining interest rates, and policy catalysts [46]

Domestic Economic Insights - The Political Bureau of the CPC held a meeting on July 30, emphasizing the need to complete the annual economic and social development goals and prepare for the 15th Five-Year Plan[1] - The manufacturing PMI for July decreased to 49.3%, down from 49.7% in June, indicating continued contraction in the manufacturing sector[12] - The non-manufacturing PMI also fell to 50.1%, down from 50.5% in the previous month, reflecting a slowdown in service sector activity[14] Industrial Performance - Industrial profits in June showed a year-on-year decline of 4.3%, an improvement from the previous decline of 9.1%[21] - The inventory of industrial enterprises slightly decreased, with finished goods inventory at 6.6 trillion yuan, showing a year-on-year growth of 3.1%[21] - The profit margin for the mining industry was 16.95%, while the manufacturing sector's profit margin remained low at 4.46%[23] International Economic Context - In July, the U.S. non-farm payrolls added only 73,000 jobs, significantly below the expected 110,000, with the unemployment rate rising to 4.2%[37] - The Federal Open Market Committee (FOMC) did not change interest rates in July, with Chairman Powell indicating no decisions have been made regarding September's rates[37] Investment Strategy Recommendations - Focus on three main investment directions: technology AI+, consumer stock valuation recovery, and the rise of undervalued dividends[4] - The report highlights the importance of maintaining a cautious approach in the current market environment, which may experience increased volatility[4]

Domestic Economic Analysis - The Politburo meeting on July 30 emphasized the need to actively prepare for the "15th Five-Year Plan" and to complete the goals of the "14th Five-Year Plan" [9][10] - The manufacturing PMI for July decreased to 49.3%, indicating a contraction, while the non-manufacturing PMI also fell to 50.1% [12][14] - Industrial profits in June showed a narrowing year-on-year decline of -4.3%, compared to -9.1% previously, with a slight decrease in inventory levels [19][21] - High-frequency indicators in transportation, such as subway passenger volume, showed a rebound, indicating some recovery in activity [26] International Economic Context - The U.S. non-farm payrolls for July were below expectations, with only 73,000 jobs added, significantly lower than the anticipated 110,000 [33] - The unemployment rate in the U.S. rose to 4.2%, reflecting a cooling labor market [33][34] - The Federal Open Market Committee (FOMC) did not lower interest rates in July, with future decisions dependent on economic data [33] Industry Configuration Recommendations - The report suggests focusing on three main investment directions: breakthroughs in AI technology, valuation recovery in consumer stocks, and the rise of undervalued dividends [3] - The report highlights the importance of maintaining a cautious approach in the current market environment, which is showing signs of overheating [3] - Emphasis is placed on the need for structural monetary policy tools to support economic recovery and innovation in key industries [10][11]

Group 1 - The core viewpoint of the report indicates that after the market reaches new highs, there is an acceleration of capital entering the market, leading to a short-term overheating and increased volatility, suggesting a cautious approach [1] Group 2 - Investment themes are categorized into three main directions: 1) Breakthroughs in Deepseek and leadership in AI technology; 2) Valuation recovery in consumer stocks and gradual recovery in consumer segmentation; 3) Continued rise of undervalued dividends [2] - The core factor for investment in the consumer sector is valuation, with a recovery cycle emerging due to low valuations, declining interest rates, and policy catalysts, despite a macro narrative that may be overly pessimistic [2] - The Hang Seng Internet ETF (513330) supports T+0 trading and focuses on the internet platform economy, including major players like Alibaba, JD.com, Tencent, Meituan, Kuaishou, and Baidu, with a high DeepSeek content of 86%, making it a suitable tool for investors to allocate to AI application and "AI + Internet" core assets [2]

Domestic Economic Overview - In June, fiscal revenue showed a slight decline, with total revenue year-on-year remaining flat at -0.31%, compared to a previous value of 0.13%. Tax revenue increased by 1.04% year-on-year, while non-tax revenue continued to decline by -3.7% [8][9] - Government fund revenue saw a significant recovery, with a year-on-year increase of 20.81% in June, compared to a previous decline of -8.15%. The land transaction revenue also rebounded, reporting a year-on-year increase of 21.89% [15][16] - The industrial production index showed a decline, with specific sectors like methanol and Shandong's independent refineries recovering, while others like pure alkali and polyester filament saw a downturn [20][21] International Conflict Tracking - The third round of negotiations between Russia and Ukraine took place in Turkey, with both sides discussing humanitarian agreements and potential future meetings [24] - In the Middle East, Israel confirmed that ceasefire negotiations with Hamas have not collapsed, while Hamas officials expressed readiness to resume talks [26][27] Industry Allocation Recommendations - The report emphasizes the importance of the "赛点 2.0" phase, indicating that the market is experiencing overheating and increased volatility. It suggests focusing on three main investment directions: 1) Technology AI+ breakthroughs, 2) Valuation recovery in consumer stocks, and 3) Continued rise of undervalued dividends [33] - The report highlights that the core factor for investment in the consumer sector is valuation, especially in the context of low valuations, declining interest rates, and policy catalysts [33]

Domestic Economic Analysis - The GDP growth for Q2 2025 was 5.2%, exceeding expectations of 5.17% and previous value of 5.4%. The primary, secondary, and tertiary industries showed growth rates of 3.8%, 4.8%, and 5.7% respectively [1][9][10] - In June, industrial production increased by 6.8% year-on-year, surpassing the expected 5.66% and previous value of 5.8%. However, social consumption and investment showed declines [11][14] - Exports in June grew by 5.9% year-on-year, higher than the previous 4.7% and expectations of 3.21%. Imports also increased by 1.1%, reversing a previous decline [43][44] - The social financing scale increased by 4.20 trillion yuan in June, with a year-on-year growth of 8.9%. New RMB loans turned positive, indicating a recovery in credit conditions [55][56] International Economic Context - The core CPI growth in the US for June was lower than expected, with a year-on-year increase of 2.9%, compared to the expected 3.0% [2][66] - The geopolitical tensions, particularly the Russia-Ukraine conflict, continue to impact global economic conditions, with potential implications for international trade and investment strategies [2][66][67] Industry Investment Strategy - The report suggests focusing on three main investment directions: advancements in AI technology, recovery in consumer stocks, and the rise of undervalued dividend stocks. The performance of undervalued dividends is closely tied to the progress in the AI sector [3][5] - The consumer sector is highlighted as having low valuations, with a potential recovery supported by declining interest rates and policy catalysts. The report warns against overly pessimistic views on consumer recovery [3][5]

Market Insights - The market index experienced a breakthrough rise this week, but there was a style switch, with mid-cap indices performing the strongest while the Shanghai 50 lagged behind [1][11] - Leading sectors included real estate, steel, non-bank financials, and construction materials, which are characterized as "cold" industries [1][11] - Historical analysis from 2014H2 and 2006H2 indicates that after the Shanghai index reaches new highs, new account openings tend to rebound, suggesting a potential style switch [1][12][19] Domestic Economic Indicators - In June, the Consumer Price Index (CPI) returned to positive year-on-year growth at 0.1%, while the Producer Price Index (PPI) saw a wider decline at -3.6% [3][24] - Manufacturing activity showed signs of recovery with the Manufacturing PMI rising to 49.7, although it remains in the contraction zone [3][34] - The supply side continued to improve, with new orders and production indices both showing marginal increases [3][34] International Economic Indicators - In June, the U.S. non-farm employment exceeded expectations, with an increase of 147,000 jobs, and the unemployment rate fell to 4.1% [4][50] - The labor market showed strong demand, with job openings rising to 7.77 million, indicating a robust employment landscape [4][52] Industry Allocation Recommendations - The report suggests focusing on three main investment directions: breakthroughs in AI technology, valuation recovery in consumer stocks, and the rise of undervalued dividends [5] - Emphasis is placed on the importance of monitoring the AI industry trends and their impact on consumer sectors [5]